Corn Drops to 1-Week Low as Rains Boost Crop Outlook

July 18 (Bloomberg) -- Corn fell for a second day to the lowest level in more than a week as rain in the U.S. Midwest is forecast to reduce crop stress, easing concerns dryness will hurt a record harvest in the world’s largest grower.

Rain across the north-central and western Midwest will improve moisture this week, MDA Weather Services wrote in a forecast today. Corn conditions worsened amid persistent dry weather, with 66 percent of the crop rated good to excellent as of July 14 from 68 percent a week earlier, government data show.

"There’s certainly been a potential improvement in forecasts over the last 24 hours, particularly in the drier parts of the U.S. western Corn Belt," Michael Pitts, a commodity sales director at National Australia Bank Ltd., said by phone from Sydney today. "If that comes to a fruition, and we don’t get any heat, then that should push us most of the way through the most dangerous part of the corn season."

Corn for delivery in December fell 1 percent to $4.97 a bushel by 5:23 a.m. on the Chicago Board of Trade. Earlier it touched $4.95 a bushel, the lowest price since July 8.

A storm will move through the Corn Belt in the middle of next week, helping ensure rainfall will be near normal in most areas, Accuweather.com forecast yesterday.

About 16 percent of corn was at the silking stage as of July 14, behind an average of 35 percent in the previous five years, the U.S. Department of Agriculture said July 15. Silking is part of the pollination stage when drought and high temperatures can hurt yields, according to the Ohio State University Extension website.

Corn futures have dropped 29 percent this year as U.S. farmers planted a record crop, estimated by the USDA to climb to 13.95 billion bushels.

Soybeans for November delivery fell 0.6 percent to $12.7575 a bushel. Wheat for delivery in September added 0.3 percent to $6.67 a bushel in Chicago. Milling wheat for delivery in November traded on NYSE Liffe in Paris was unchanged at 194.50 euros ($255) a metric ton.